Welcome to Legacy
Spring 2005

Inside This Issue

Red Cross Helps Get the Message Through

Charitable Remainder Trusts Can Achieve Your Goals

Give Your Home, But Keep Living There

Make the Most of Your IRA

Mission Statement

The American Red Cross, a humanitarian organization led by volunteers and guided by its Congressional Charter and the Fundamental principles of the International Red Cross Movement, will provide relief to victims of disaster and help prevent, prepare for and respond to emergencies.

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Give Your Home, But Keep Living There

Give Your Home, But Keep Living There

If you own your home or farm - or even a vacation home - you may be able to make a gift of the property, obtain an immediate income tax deduction and still continue to use the property for as long as you wish.

How does this work? Simply give the property, but retain the right to use it for your life (a "life estate"). You can continue to live in your home or receive income from the farm, and only after your death will the property pass for our benefit. By arranging this gift now, rather than in your will, you receive an immediate income tax deduction for the present value of our future right to receive the property.

Let's look at how this type of gift might fit into the plans of a couple we'll call Sam and Cathy. Sam is 77 years old and Cathy is 75. They are retired, but pay substantial income tax each year. Sam owns the home that they live in (currently worth $500,000) and he finished paying off the mortgage ten years ago. Sam and Cathy plan to live in their home for the rest of their lives. However, they also would like to make a significant gift to assist Red Cross programs.

Sam has decided to deed the home to the Red Cross, retaining use of the home for his life and for Cathy's life. Based on their ages and other factors, Sam will receive an income tax deduction this year of about $221,000. Their tax savings (more than $50,000) can be invested to provide them with more income in retirement.

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